December 28, 2009

THE MYSTERY OF THE MULTIPLE COUNTER OFFER

Posted to Julie Sarton

Your home has been for sale for over a year, but finally the market is picking up and showing signs of recovery. From almost no showings, all of a sudden there have been three in two weeks; two of them came back for a second showing and seem very interested. Your agent calls in several days with the news that you‘ve received not just one offer to purchase…. you’ve received two! After reviewing them both with your agent, you discover that they’re both good offers and each have attractive features. Neither, however, is good enough at this point to accept. What to do now?

This is the perfect situation for the Multiple Counter Offer (MCO) to come to the rescue. If you counter only one of the offers, you run the risk of not being able to come to an agreement with that buyer and having buyer #2 walk away in the meantime. The MCO allows you to counter to both buyers, see how they each respond, and then choose the one you like. And, you don’t have to counter the same to both buyers, but can choose items in each offer that you want to change. For example, one buyer’s purchase price may need countered, and the other buyer’s closing date may need countered. Since the buyers will each know that there is another offer being considered, sometimes they will counter back higher than asking price to get their bid accepted. In a standard counter offer from a seller, once the buyer signs it it’s binding. In a multiple counter offer, once each buyer signs it, it goes back to the seller to pick one; once the seller signs one, it then becomes binding.

It can be a tricky transaction and both buyers and sellers should make sure they’re working with an agent that understands all the options and can explain it to their clients. SELLERS: the main downside is that if two buyers think they’re going to get into a bidding war, they could both walk away and you’ll end up with no buyers at all. BUYERS: once you receive a MCO from the seller, you must come back with your BEST AND HIGHEST OFFER, as you probably will not have another chance. Many buyers don’t believe that, and lose a home they really want (I just had this happen with a buyer). Good luck!

Posted by:Julie Sarton

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